Throughout the countryside, the Afghan people are fed up with being robbed by their government. Bureaucrats require bribes, the police and security services rob and steal their share too.
I wonder when the American people will figure out that, for the past twenty years, they've been routinely fleeced by their establishment too.
How many little people lost their life savings, their retirement money in the Savings & Loan scandals?
How many little people lost their life savings, their retirement money in the Dot.Com bubble?
How many little people lost their life savings, their retirement money in the Enron/WorldCom scandals?
How many little people have lost everything in the collapse of the housing bubble?
How many little people have lost everything in the Wall Street meltdown?
How many little people will continue to lose everything - their homes, their jobs, their savings - in the recession/depression that their country is only just beginning to suffer?
Even before the housing bubble burst, household debt had never been higher and home equity had never been lower in America. There was notional prosperity - for some - in the paper value of residential real estate. The housing sector drove the biggest economy in the world. Does that sort of sound insane? It was. You can't build an economy on people selling their homes to each other. That's a scam but it's also a scam that was tolerated, even encouraged at the highest levels of the American government.
The only good thing is that you have to get through the hangover before the next bout of binge drinking and this time it could take years for the fog to clear. 159,000 jobs lost in September. That's bad but those figures don't include the jobs that are being shed from the meltdown.
The State of California, largest state in the Union, can't get loans on the open market. The Governator has turned to Washington, asking for a $7-billion advance. They're out of money. They're just one state government out of money and there are plenty of municipal governments and many businesses that are also running out of money.
This bailout isn't going to ease America's dependence on foreign money. America's federal, state and municipal governments are going to continue to spend more than their take in revenues. And, for the short-term certainly, more American companies will survive or fall on whether they can borrow.
So, why bail out Wall Street at all? Why not just let it collapse with all its bad paper? A lot of Americans were asking that. A lot of their representatives in Congress were asking that. Rescuing Wall Street seemed understandable but it never seemed like enough, it didn't seem like the right answer. It wasn't.
If you want the answer, you have to follow the money. Including the federal deficit, Washington is looking at borrowings this year of about one and a half Trillion dollars. A trillion dollars in bailouts, half a trillion more to cover Washington's own deficit spending.
How much will Washington need next year and the year after that? Unless they stop waging wars they can't afford, something has to give. In a recession/depression, governments are expected to step in to help. Unemployment spreads, welfare lines grow - that sort of thing. It's going to be pretty tough to enshrine tax cuts for the wealthy and promote wars without end while this is going on.
We know this year's bailout spending is a trillion dollars. We don't know what next year's bailout spending bill will be. No one knows what next year's recession/depression relief bill will be. No one can tell any longer what next year's federal revenues and deficit will look like.
The one thing that everyone does know but doesn't want to mention is where all this money will come from, foreign lenders. America's financialized economy isn't as vibrant or robust as an industrialized economy. It doesn't bounce back as easily and it's far more fragile, more vulnerable to adverse changes. Right now it's facing one horrific adverse change that could undo everything - let's call it the Euro.
If foreign lenders lose confidence in the US dollar and demand that their loans be denominated in stronger currencies such as the Euro, the American economy's residual strength is gutted. If the Euro becomes the global reserve currency instead of the greenback, there's no way in hell America will be able to avoid a full blown depression that may make the Dirty 30's look not so bad after all.
I think all those holdout Congressmen finally heard the tsunami warning that, if they didn't bail out Wall Street, the Euro wave would be on them in short order. They absolutely had to prove to America's foreign creditors that they were ready to open a vein if that's what it took to salvage America's securities and banking sector. And so they did.
One thing John McCain has right is that this bailout is merely the end of the beginning of America's struggle to control the meltdown. This isn't so much pulling out of a dive as it is trying to survive a controlled crash.
The chart I posted the other day showed how America's federal debt to GDP ratio soared under Reagan/Bush I and again under Bush II, but if the American economy begins to retract as government debt rapidly expands that ratio may go right off the charts altogether.
I wonder when the American people will figure out that, for the past twenty years, they've been routinely fleeced by their establishment too.
How many little people lost their life savings, their retirement money in the Savings & Loan scandals?
How many little people lost their life savings, their retirement money in the Dot.Com bubble?
How many little people lost their life savings, their retirement money in the Enron/WorldCom scandals?
How many little people have lost everything in the collapse of the housing bubble?
How many little people have lost everything in the Wall Street meltdown?
How many little people will continue to lose everything - their homes, their jobs, their savings - in the recession/depression that their country is only just beginning to suffer?
Even before the housing bubble burst, household debt had never been higher and home equity had never been lower in America. There was notional prosperity - for some - in the paper value of residential real estate. The housing sector drove the biggest economy in the world. Does that sort of sound insane? It was. You can't build an economy on people selling their homes to each other. That's a scam but it's also a scam that was tolerated, even encouraged at the highest levels of the American government.
The only good thing is that you have to get through the hangover before the next bout of binge drinking and this time it could take years for the fog to clear. 159,000 jobs lost in September. That's bad but those figures don't include the jobs that are being shed from the meltdown.
The State of California, largest state in the Union, can't get loans on the open market. The Governator has turned to Washington, asking for a $7-billion advance. They're out of money. They're just one state government out of money and there are plenty of municipal governments and many businesses that are also running out of money.
This bailout isn't going to ease America's dependence on foreign money. America's federal, state and municipal governments are going to continue to spend more than their take in revenues. And, for the short-term certainly, more American companies will survive or fall on whether they can borrow.
So, why bail out Wall Street at all? Why not just let it collapse with all its bad paper? A lot of Americans were asking that. A lot of their representatives in Congress were asking that. Rescuing Wall Street seemed understandable but it never seemed like enough, it didn't seem like the right answer. It wasn't.
If you want the answer, you have to follow the money. Including the federal deficit, Washington is looking at borrowings this year of about one and a half Trillion dollars. A trillion dollars in bailouts, half a trillion more to cover Washington's own deficit spending.
How much will Washington need next year and the year after that? Unless they stop waging wars they can't afford, something has to give. In a recession/depression, governments are expected to step in to help. Unemployment spreads, welfare lines grow - that sort of thing. It's going to be pretty tough to enshrine tax cuts for the wealthy and promote wars without end while this is going on.
We know this year's bailout spending is a trillion dollars. We don't know what next year's bailout spending bill will be. No one knows what next year's recession/depression relief bill will be. No one can tell any longer what next year's federal revenues and deficit will look like.
The one thing that everyone does know but doesn't want to mention is where all this money will come from, foreign lenders. America's financialized economy isn't as vibrant or robust as an industrialized economy. It doesn't bounce back as easily and it's far more fragile, more vulnerable to adverse changes. Right now it's facing one horrific adverse change that could undo everything - let's call it the Euro.
If foreign lenders lose confidence in the US dollar and demand that their loans be denominated in stronger currencies such as the Euro, the American economy's residual strength is gutted. If the Euro becomes the global reserve currency instead of the greenback, there's no way in hell America will be able to avoid a full blown depression that may make the Dirty 30's look not so bad after all.
I think all those holdout Congressmen finally heard the tsunami warning that, if they didn't bail out Wall Street, the Euro wave would be on them in short order. They absolutely had to prove to America's foreign creditors that they were ready to open a vein if that's what it took to salvage America's securities and banking sector. And so they did.
One thing John McCain has right is that this bailout is merely the end of the beginning of America's struggle to control the meltdown. This isn't so much pulling out of a dive as it is trying to survive a controlled crash.
The chart I posted the other day showed how America's federal debt to GDP ratio soared under Reagan/Bush I and again under Bush II, but if the American economy begins to retract as government debt rapidly expands that ratio may go right off the charts altogether.
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